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Sunday, December 07, 2003

Political entrepreneurship - is India ready for it?

I sense a feeling amongst many of us today that our only political options are either the BJP or the Congress (with the myriad other parties throwing their weight behind one or the other), and that we have to put up with all their negatives in the hope that the negatives of either of them (or even both) will somehow disappear over time.

If this were a market scenario, I'm sure there would be at least a handful of punters willing to seize the opportunity and bet that starting a new outfit afresh (free from the past baggage, the vested interests and the geriatric leadership) would stand a very fair chance of success over time. There are enough instances of successful late entrants in the business world for us to take heart. Why, there's even an example in politics right here at home - the Telugu Desam Party (TDP) started out quite late to provide an alternative to the Congress and has quite successfully established itself.

I think there's much more than a fighting chance for a new and well organised party, starting from scratch, to gain a substantial mindshare and influence the political agenda of the nation. The initiative towards starting a new party - the Liberal Party of India, is one such step in that direction. Of course, it will be a long haul and will take a lot of doing - but are the majority of us aborting action on this front even before contemplating it, overcome by the enormity of the challenge?

We need political entrepreneurs today just as much business entrepreneurs, may be more so. Can (or will or should) some of the successful business entrepreneurs look to turning political entrepreneurs? In many other countries, successful business entrepreneurs have gravitated to politics in their later years - a trend that has been on the ascent in recent years. Narayana Murthy (NM) of Infosys is a name that comes to mind as an possible example of someone who could do the same in the Indian context. NM has built up a very successful organisation from scratch and commands a phenomenal amount of goodwill and equity from the middle classes to be able to ignite the hope that a newly launched political entity can be successful and actually go on to mobilise people towards turning that hope into action. I think he can do it if he chooses to.

If NM were to think about this, he might ask himself if he should focus on business (Infosys) or politics (the nation), going ahead? Are the two options largely mutually exclusive or can he do both simultaneously? One could argue that serving Infosys and continuing to help it grow is itself the best way for him to serve the nation, but is that how he can add the most value, being who he is and given his experience and stature?. Going back over a hundred years, many leading successful (wealthy) lawyers of the day (among them Patel, Rajagopalachari, (Motilal) Nehru, Rajendra Prasad and others) thought it necessary to also be politically active alongside pursuing their professions to make a living, and eventually managed to help the nation become free. Is it the turn of successful businessmen to do something similar now to catalyse and hasten progress?

In addition to successful entrepreneurs, can salaried professionals from all fields also get involved in politics part-time, in addition to their normal professional activities or does politics absolutely require full-time commitment which is possible only for either the very wealthy who have no need for any other means to make a living or the opportunistic folks who get into politics to make a "living". I think involvement in politics outside of work time is very much possible and quite necessary. A political entrepreneur can count on this huge constituency of professionals if he or she is able to paint an attractive vision for the future along with a plan to get there and convince this large constituency to buy into it.

Emerging Economies

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Claus and Edward's "Baker's Dozen"

Claus Vistesen and Edward Hugh are proud and happy to announce that they are now working as "featured analysts" with a new Boston-based start-up - Emerginvest.

Claus and Edward have used a new, updated, methodology in order to identify a group of 13 emerging economies which we consider are going to outperform both the rest of the emerging economy group and the OECD economies in terms of a number of key performance indicators over the 2008 - 2020 horizon.

Through our association with Emerginvest we hope to develop performance indicators which will confirm both the relevance and validity of the selection procedure adopted.

We would like to point out that we have absolutely no financial connection whatsoever with Emerginvest - although we do heartily endorse what they are trying to do.

In particular we see the move by the investment community towards emerging markets as one of the most effective and direct ways to address those issues of inter-country wealth and income imbalances which have plagued our planet for so long now - namely by getting the money from the rich who have it to the poor who need it.

Sending investment to emerging economies is also a way of addressing the underlying imbalances which exist between the relatively older populations of the developed economies who increasingly need to save, and the relatively younger emerging economies who can benefit from the investment of those savings in their countries. So in a way you can both ensure the future of your own pension and help attack poverty at one and the same time. This type of possibility is normally known in economics as "win-win".

The oldest known source and most probable origin for the expression "baker's dozen" dates to the 13th century in one of the earliest English statutes, instituted during the reign of Henry III (r. 1216-1272), called the Assize of Bread and Ale. Bakers who were found to have shortchanged customers could be liable to severe punishment. To guard against the punishment of losing a hand to an axe, a baker would give 13 for the price of 12, to be certain of not being known as a cheat. Specifically, the practice of baking 13 items for an intended dozen was to prevent "short measure", on the basis that one of the 13 could be lost, eaten, burnt or ruined in some way, leaving the baker with the original dozen.

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About Claus

Claus Vistesen is a 23 year old macroeconomist who is on the point of finishing his MSc in Applied Economics and Finance from the Copenhagen Business School. His primary research interests are international finance and international macroeconomics. Claus is especially interested in how the changing structure of global and national demographics impacts on local macroeconomic performance. Moreover - and as the wonk he ultimately is - he also takes a considerable interest issues and methodologies associated with econometrics, and this is an interest he intends to develop in his postgraduate research.

About Edward

Edward 'the bonobo' is a Catalan macroeconomist and economic demographer of British extraction, now based in Barcelona. By inclination he is a macroeconomist, but his deep-seated obsession with trying to understand the economic impact of contemporary demographic changes has often taken him far from home, off and away from the more tranquil and placid pastures of the dismal science, into the bracken and thicket of demography, anthropology, biology, sociology and systems theory. All of which has lead him to ask himself whether Thomas Wolfe was not in fact right when he asserted that the fact of the matter is "you can never go home again".

He is currently working on a book with the provisional working title "Population, the Ultimate Non-renewable Resource".